Mandatory Means Less Freedom

Updated Dec. 1, 2000 12:01 a.m. ET

T oday Hong Kong's Mandatory Provident Fund scheme comes into effect, meaning all employers and even self-employed individuals are supposed to have signed up for a government-approved retirement savings plan. The justification for this piece of government intervention -- that it will guarantee that residents save enough for retirement -- is faulty, since Hong Kong people already save at a sufficient rate to provide for their old age. The chief effect will be a reduction of the territory's economic freedom.